GoCardless is now required to charge VAT across all of the fees that we charge for our services provided to merchants located in the UK and France. This is due to a change in the application of tax law which means we can no longer benefit from a VAT exemption applying to the supply of payment services. 

Given the current situation with Covid-19, we have decided to absorb the cost of VAT for existing customers until 1 September so that we can give you sufficient notice to adapt to this change. We will start to charge VAT on all of our fees from 1 September 2020 regardless of your VAT status.

If any of the goods or services that you supply are VAT exempt or you are underneath the VAT threshold then you won’t be able to reclaim the cost of VAT. We realise this may have a significant impact for you, especially given the impact of the Covid-19 pandemic. We are therefore putting aside a VAT relief fund in order to help offset the impact of these changes for customers that are VAT exempt or underneath the VAT threshold. 

If you activated your account or signed a contract before 1 June 2020 you can provide us with documentation to demonstrate your VAT exempt status, or that your business falls under the VAT registration threshold and we will assess the impact of the VAT charge.

We opened the process to assess cases on 15 June 2020. On this page you can find more information on the required documentation. Once you’re clear on the documentation that you need to provide to confirm your VAT status, you can complete the form and upload your documents no later than 1 August 2020. 

We acknowledge that there will be cases in which none of the documents listed below will be relevant or available to merchants that supply goods or services that are exempt from VAT or who are below the VAT registration threshold. In such cases, you should advise of us your VAT status in the boxes indicated. If you are unable to provide any of the documentation requested, this does not mean you will not be considered for a discount. We will attempt to assess your claim by alternative means and may contact you about this. We encourage you to provide any of the documents requested that are relevant and available to you, as this will facilitate our assessment. We further acknowledge that some of these documents are confidential in nature. Any documents provided will be treated in compliance with GoCardless’s data protection procedures.

What documents can I provide?

If any of the goods or services that you supply are exempt from VAT - we ask that you provide us with any of the following documentation which is relevant and available to you:

• A copy of an invoice showing goods/services that you sell that are VAT exempt (if available)

• Ruling letter from HMRC confirming exempt status (if available)

• A copy of a partial exemption special method agreed with HMRC (if available)

• A partial exemption calculation done and input onto a VAT return (if available)

• A Charity Commission registration number if a charity 

If your business falls under VAT threshold - we ask that you to provide us with: 

• A copy of your statutory accounts or financial statements for the previous 12 months or latest available (if available)

• A copy of an invoice showing that VAT has not been charged on the goods/ services that you sell (if available)

If any of the goods/services you supply are VAT exempt

A copy of an invoice showing goods/services that you sell that are VAT exempt

The following document should be provided, if available:

• If you are fully exempt, a copy of an invoice issued to a customer and dated within the previous 12 months. The customer's name and address should be redacted. Example here

• If you are partially exempt, a copy of an invoice issued to a customer and dated within the previous 12 months. The customer's name and address should be redacted. The invoice provided should include charges for goods or services that are exempt from VAT.

Ruling letter from HMRC confirming exempt status (if available)

The following document should be provided, if available:

• A copy of a letter from HMRC confirming that the entity supplies goods or services that are exempt from VAT, or partially exempt from VAT

A copy of a partial exemption method agreed with HMRC (if available)

The following document should be provided, if available:

• A copy of a letter from HMRC confirming a special method to calculate the input VAT recoverable (PESM) Example here

A partial exemption calculation done and input onto a VAT return (if available)

The following document should be provided, if available:

• A copy of a VAT return submitted by the merchant within the last 12 months showing a partial exemption calculation. Example here

A Charity Commission registration number if a registered charity

The following document should be provided, if available:

• The registration number issued by the Charity Commission to the charity

If you are under the VAT threshold

A copy of an invoice showing goods/services that you sell that are VAT exempt

The following document should be provided, if available:

• A copy of an invoice issued to a customer and dated within the previous 12 months. The customer's name and address should be redacted. Example here

Statutory accounts for the previous 12 months or latest available

The following document should be provided, if available:

• If you are a Limited company registered in the UK: A copy of the financial statements for the latest period for which accounts have been filed with Companies House. If a micro-entity or a small company, that does not file its profit and loss account with Companies House, we request you to include the Profit and Loss statement with the accounts you share with GoCardless. Example here

• If you are a sole trader in the UK: a copy of the financial statements for the latest period for which they have been prepared. If sole trader accounts are not prepared, then ignore this section.